Midstream Energy Industry Faces Headwinds Amid Conservative Spending
The midstream energy industry, which includes companies that own and operate pipeline networks, is less vulnerable to fluctuations in oil and gas prices. However, the outlook for this industry is gloomy due to conservative spending by upstream companies, leading to reduced demand for transportation and storage assets.
According to Zacks Industry Rank, the Oil & Gas - Production and Pipelines industry has a rank of #182, placing it in the bottom 26% of more than 250 industries. This indicates bleak near-term prospects for the group.
Kinder Morgan, The Williams Companies, and MPLX are three oil and gas pipeline stocks that are well-positioned to weather industry headwinds. These companies have strong growth potential from increasing liquefied natural gas demand and generate stable fee-based revenues from long-term contracts with shippers.